The Central Bank of Egypt (CBE) is expected to finally cut benchmark interest rates by between 50-100 bps when the Monetary Policy Committee (MPC)

Insights MENA

Economic Outlook

The Central Bank of Egypt (CBE) is expected to finally cut benchmark interest rates by between 50-100 bps when the Monetary Policy Committee (MPC) meets this Thursday. Easing inflation, coupled with the US Federal Reserve and several emerging market central banks cutting interest rates, relieves much of the pressure on the CBE and leaves room for a cut.

Egypt Ministry of Finance is planning to reduce the country's debt-to-GDP ratio to pre-2011 levels of 77.5% by 2021/2022. This is lower than the previous target announced in March 2019, which aimed to reduce debt to 80% of GDP by 2022.

The Federal Tax Authority (FTA) has launched a new electronic system for registering excise goods as part of its plans to continuously develop the tax system as a whole, and excise tax procedures, in particular.

The two-day Euromoney Saudi Arabia Conference, one of the most important financial events in the region, will open in Riyadh on September 18 with a focus on the new financial ecosystem focusing on the intersection between changes in finance and the Kingdom.

Saudi Arabia has deposited 937.7 MM SAR (250 MM USD) in the Central Bank of Sudan to support its financial position. The deposit is part of a package with UAE worth 1.8 BN SAR (500 MM USD) announced in April. Both countries pledged an overall 11.2 BN SAR (3 BN USD) in aid, with the rest going towards fuel, wheat and medicine.

Political Events

Sudan Forces of Freedom and Chance (FFC) opposition coalition and the Transitional Military Council (TMC) have signed the final power-sharing agreement that will see a "sovereign council" set up to rule the country for a transitional three-year period until elections are held. The council will include five members nominated by the TMC, five by the FFC, and one agreed on by both parties.

President Abdel Fattah El Sisi inaugurated 1.3k greenhouses built over a 10k feddan area as part of the second phase of a project in the Mohamed Naguib military base on the Cairo-Alamein road. The "100k greenhouse project" is the largest of its kind in the Middle East and is enough to provide food for 20 million people.

Stock Market

The Abu Dhabi Securities Exchange (ADX) unveiled its plans to list the first issuance of ESIC Sukuk Limited worth 600 MM USD. The issuance will be listed today, under the market symbol (XSESICS0724).

Companies Transactions

The Egyptian government is planning to offer shares in either state-owned Banque du Caire (BdC) or financial technology company e-Finance through an initial public offering before the end of 2019. Noting that Pharos' investmentbanking arm and Renaissance Capital were tapped to act as joint global coordinators for the sale, meanwhile, Zaki Hashem & Partners will act as legal advisors, and Baker Tilly will be preparing the fair value report.

California-based data analytics startup Incorta, which bases its software development operation in Egypt, has raised 30 MM USD in a series C funding round. US-based private equity firm Sorenson Capital led the round, which saw participation from Google Ventures and Microsoft's Venture Fund (M12), as well as the Tesla venture fund counterpart.

Saudi Arabia will need to push for more substantial production cuts at the December Opec+ meeting amid a sustained slump in oil prices. Prices need to exceed 60 dollar per barrel if Saudi Aramco targeting to reach 2 TR USD when its long-awaited IPO takes place.

VMware, which provides cloud computing and virtualization software and services, has awarded Saudi Arabia Saudi Telecom Company (STC) a certificate for providing cloud computing service. Accordingly, STC became the first Saudi company to be globally accredited for providing cloud-based services.

Saudi automotive company Mohamed Yousuf Naghi Motors has acquired the Ford Motor and Lincoln distributorship from Al Jazirah Vehicles Agencies Co in the western and southern regions of Saudi Arabia.

Abu Dhabi National Exhibitions Company (ADNEC) contributed 2.29 BN AED (626.14 MM USD) to Abu Dhabi economy in H1-2019. The company's direct and indirect contribution to UAE capital's economy increased by 45% in H1-2019, compared to the same period in H1-2018.

Etihad Airways, the national airline of the United Arab Emirates, was the most punctual Middle Eastern carrier in the first seven months of 2019. Moreover, Etihad was ranked 24th globally for on-time performance in July, the peak summer month for air travel in the Middle East.

Al Salam Bank, listed on both Bahrain Bourse and the Dubai Financial Market (DFM), stated that the news published on a possible merger with UAE Mashreq Bank is "incorrect".

Gulf International Services(GIS), one of the largest service groups in Qatar, has executed a joint venture agreement with Seadrilllimited to service the Qatar Petroleum North Field Expansion drilling program. The joint venture, which will be established by Qatar Financial Centre under a 50:50 ownership structure, will be named "GulfDrill".

Russia second biggest bank VTB has acquired a 19% stake in Qatari lender CQUR Bank which was set up early 2019.

Kuwait and Middle East Financial Investment Company (KMEFIC) announced that it has fully repaid the outstanding loan amount worth 2.46 MM KWD (8 MM USD) included in the financial statements dated 30 June 2019 to the parent company.

Sports and Culture

Egypt U19 Handball team beat Germany 32-28 in the final in Macedonia to become world champions. The Egyptian team dominated the first half of the game, finishing with a lead advantage (19-13), and continued to maintain their upper hand and make history.

A photograph of Egyptologist Zahi Hawass will appear on the big screen of New York's Times Square every two minutes for a month as part of a new tourism promotion campaign. Noting that the photo will be accompanied by a message inviting Americans to visit Egypt.

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